3D Printing Arbitrage Is The New Hotness

0

As the 3D printing space heats up and home printers gain ground, there’s a new breed of startup that aims to grab the transactional costs associated with connecting printers and people. The first one I saw (and used), MakeXYZ.com, launched last February. Now the space is about to be inundated with competitors.

3D printers are still expensive. Like early laser printers, they are a major investment and their operation is sometimes fiddly. However, the value of a printer goes up immensely when owners are connected with people who need things printed, just as early users of Brøderbund’s Print Shop would soon become the desktop publishers of the 1990s.

My own experience in the market has been enlightening. First, I’m on the first page for “3D printing Brooklyn” in Google, making me a go-to source for one-off prints. I’ve already printed a number of eyeglass frames for an artist in Williamsburg and even spent a night printing a huge architectural model for a student who needed a quick turnaround. It hasn’t made me much money, but it was fun.

That last sentence, however, should give the folks trying to enter the 3D printer arbitrage space pause. Companies like Disrupt favorite 3dlt, Cuboyo, and a new offering from Printchomp are offering a method for customers to connect with printers. However, the potential for revenue is capped by the number of printers in the world and, what’s more, once printers and customers are connected these services soon become redundant. As much as I’ve tried, for example, to keep MakeXYZ in the transaction sometimes it has been hard. I suspect it’s the same problem that eBay had early on and solved, ultimately, by owning its own payment platform.

“Shapeways is focused on being a vertically integrated printed owning all of the process and equipment. This method is inherently flawed, because a great deal of their current capital investments is focused around machinery that will essentially be dated very quickly,” said Joseph Puopolo, founder of Printchomp. “3D printing reminds me of the early days of the PC. While some people are so focused on the hardware elements of it, it is more about the software and making that hardware accessible to people. The crucial part is the connection component to speed adoption to the mainstream.”

Can arbitrage rake in the big bucks? I’m not certain, at least not yet. Given the number of home 3D printers available – Makerbot, for example, has sold an estimated 22,000 units since its founding in 2009 – the opportunities are slim to scrape off the transactional fees associated with connecting makers to customers.

Given that companies like Tesco and Staples are also looking into 3D printing in stores, the window on capitalizing on home 3D printers could be quite small.

That’s not to say that this space isn’t important. I’ve learned lots about engineering and design in the few months I’ve been Brooklyn’s own 3D printing Gepetto and these services empower makers by creating demand for their products. Home 3D printers are far faster and far cheaper than the professional-grade machines used by services like Shapeways and they’re a great way to spur innovation in the 3D printing space by turning all of us into potential manufacturers.

Additionally, 3D printers have enabled a new type of manufacturer to thrive. For example, Square Helper is a little piece of plastic that holds Square card readers in place when they’re plugged into iPads and iPhones. The creator, Chris Milnes, has a number of machines going all day and night to print these little lumps of plastic and is making quite a bit of cash.

Hardware manufacturers needed brokers to connect them with clients. But this arbitrage breaks down when you’re not talking about 100,000 cellphones and instead are talking about a 3D printed crown for a cake shop. These connectors are important to the industry, I’m just worried about how long they can stay vital.